July 14, 2006

Laws We Can’t Afford

The New York Times reported Thursday that Wal-Mart has adopted a new policy of not prosecuting shoplifting if $25 or less is involved. Why has Wal-Mart gone soft? It costs too much to enforce the law, too much for Wal-Mart, and that is with Wal-Mart just focusing on its costs. The costs to the police of enforcing those laws are substantial; indeed, South Strabane Township in Pennsylvania (population 9,000) has one of its 16 officers tied up on Wal-Mart shoplifting duty. And Dan Filler notes how much of the local court docket is chewed up by shoplifting.

As Stephen Dubner points out, the change could give rise to some interesting empirical effects. He focuses on what the police will do now that they are not hanging out at Wal-Mart. I want to know how many more shoplifters well head to Wal-Mart and will they be careful to choose the $24.99 headphones rather than the really nice ones?

But my real interest here, raised before, is whether we would benefit by lowering the cost of enforcement, should we have such a technology available? If Wal-Mart and the police could drop the cost of enforcement 50% or more, is there any reason we shouldn’t want that?

Comments

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Kimball, I'm absolutely in favor of helping people get a start in life, and I'm *strongly* in favor of better funding for adult education, as I noted in previous response ("adult" here meaning post-high school -- obviously high school is important too but our focus as a society is so much on mandatory public schools but nothing after that, and I think the lack of attention to higher education is shortsighted). I absolutely agree that higher education is under-funded; I got to deal with a lot of this up close and personal while I was student body president at a state university. Idiocy like the Solomon Amendment only adds to the difficulties and complications of providing meaningful and effective higher education.

And I agree with you that commitment to the ends of equality needs to be achieved first. I don't think raising the estate tax is going to do that -- all that will lead to is rich people paying their accountants and estate lawyers to find the loopholes, and there are always loopholes. Meanwhile, the moderately rich (people with a couple million in assets) will pay the brunt of the increased taxes, thus further dwindling the middle class and adding to the bankroll of the extremely rich (say, 20M and above). I also think that *all* equality concerns deserve this kind of treatment -- which would mean, for example, replacing band-aid programs like affirmative action with actual, positive steps toward remedying inequality.

I don't know about Kaiser... I've had Kaiser and didn't particularly like them. On the other hand, my law firm's PPO has given me some of the best health care benefits I've ever gotten. Perhaps my law firm should manage the country's health care ;)

Also, as an aside, I fit into category (b) you mentioned -- at the ripe old age of 25 (as of tomorrow), I don't think it's sensible to consider me done and over the hill just yet.

I do think that things like term limits and campaign spending caps could help, though -- if you limit institutionalized power and prevent waste on the campaigning level (by reducing the amount of money wasted on the government equivalent of a popularity contest), then you've got a much better shot at getting politicians who are there for a reason other than money. Obviously this would have to entail cutting the ridiculous lifetime benefits that accrue to someone for serving even one term as a congressman. Congress will never do this itself -- perhaps a grassroots campaign along the lines of the ERA (though, hopefully, this time more successful) would be called for to prevent Congress from patting itself on its well-moisturized back while the rest of America teeters near the poverty line.

LAK, I don't buy the argument that money attracts the best people. For example, *many* of my peers at U of C law, which I'd say is a pretty intelligent and competent bunch overall, opted to go into public service, government, and nonprofit work, in spite of the fact that it pays substantially less and can, in fact, be more competitive than some of the big firm jobs. Money attracts people who care about money -- which means that perhaps we ought to make government jobs the lowest-paid, but with high benefits, in order to attract people who are more concerned with the actual work than the pay (the benefits would ensure they aren't penalized for doing good works).

Hmm. I strongly disagree. U of C lawyers aren't the best bunch to meaure on the issue, but...

1. A lot of the people who go into government are just more power oriented than money. The fascist Scalia/Thomas wannabe clerks are similar to the money oriented people, but with power, and a knowledge that money will eventually follow power.

2. I'll still bet if you line up the top 10% of any class, the majority go to work for fancy evil corporate firms like Skadden and Wachtel. Certainly not non-profits.

3. Lawfairy, you probably have a sample bias given the altruism and morality of those who you likely ran with at school. Those motivated by a higher power tend to be far more selfless.

Law Fairy,
I am sorry. When you said adult education I interpreted that as middle aged literacy programs, job retraining programs and remedial help programs of various sorts for older adults and wondered why, but did not ask, you singled those out. Don’t ask me why. Perhaps, from having had a few, I don’t usually think of early twenties people as real adults. I guess my age is showing. But I think we agree, those just starting at the college or university level need our help, we should do more to equalize access or opportunity at that level and if we don’t provide the help some need, too often they wind up being significantly disadvantaged in life and unfairly.

We also agree that a greater commitment to the ends of equality needs to be achieved first. But if not by the estate tax, then how, realistically? Every targeting effort is subject to the argument that rich people will pay their accountants and estate lawyers to find the loopholes, and there are always loopholes, “while those only moderately rich will bare the brunt of the load.” Why not run the program like a highway tax trust fund and make it largely loop hole free? 100% of the assets of liquidated estates go in (with a $500 deductible for heirlooms, so the family’s megayacht is not slipped through), and the trust mails out the subsidy checks to the young adults over four years. And you are right on the Band-Aid type of programs. They are bones thrown to political interests to keep them quiet and thinking they did the best they could. They don’t really do that much.

I am not wedded to Kaiser so much as the idea of preventive medicine and treatment to avoid large medical costs later and doctors checking the health of people earlier rather than just later. I believe in preventative medicine as a serious cost saving mechanism. How can those just starting school have an equal opportunity if they have unattended medical problems that are left untreated and soon used as a means to screen them out from opportunity.

25 years old tomorrow! Let me jump the gun and wish you a Happy Birthday. Have a good one, and “No,” you are not over the hill and done. I am. You are just starting out and up. But consider well that, with or without a coherent game plan for your life, it will still shoot by like a rocket and you will find yourself at my age wondering where it went, no matter how much you have accomplished. In fact, the more you do, the faster it goes.

On term and campaign limits, and lifetime trough feeding privileges, we agree, with questions about implementation still open. As our exchange makes clear, America needs a sensible, coherent and integrated agenda much more than a fruitless war with Arab fanatics more bent on killing each other than us. But we seem very far removed from what we really need in these regards. It is a shame.

LAK and Law Fairy,

On the question of government getting better people, I tend to think many good law grads take up the mantle of governmental work like a clerkship to be shed after a few years to pursue the cash, using it as a credential. Work in the Justice Department certainly qualifies here. It all is a part of the “revolving door” Cheney and others have developed into a high art. Haliburton does better when Cheney is Vice President than when he is CEO and to be sure Cheney has greater rewards awaiting him when his term of office as Vive President is done. Companies don’t forget their friends. The conclusion is then it is hard to get good people for the longer term in government who really have their hearts in their work and are not drowned out quickly by lobbying and revolving door efforts working against them. Government is too much a service to be bought and paid for.

If not the estate tax you ask? How about income tax? That seems to be the most reasonable, and contrary to the going story, people will have the same incentive to excel with more progressive income taxation schemes, so long as one can still differentiate themselves from the masses. Status signaling might look less grotesque if there was more equality in the distribution of income, but it would still exist.

To argue loopholes are inevitable is to sound naive in my opinion. All you need is an IRS and an SEC and a DOJ and a FBI with some real ability to enforce laws, and all you need is a congress not run exclusively by those super rich, loophole getting folks. So simple, right?

The income tax is the general source of revenue and has far too many hands in and on it and is already out of control regarding loopholes, foolishness and expenditure commitments. More revenue from it could never be isolated for anything specifc. I think a trust like the federal highway trust fund used just for roads would be much better. If we tried a trust fund with an increase in income taxes it would fail too for the same reasons and be borrowed against as well.